Rishi Sunak fails to offer Yorkshire same guarantee as Cornwall on post-Brexit funding

Rishi Sunak's Spring Statement has failed to offer Yorkshire the same guarantee previously provided to Cornwall on the Government's flagship post-Brexit regional funding programme.

In October, Mr Sunak's Autumn Statement had specified that the total funding delivered through the new Shared Prosperity Fund would “at a minimum match the size of EU funds” previously provided to Cornwall.

Northern politicians, including South Yorkshire mayor Dan Jarvis, had been pressing for a similar commitment to the one made to Cornwall for their areas but this has not been included in the Spring Statement. Mr Jarvis has said that South Yorkshire alone is owed £900m.

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The issue was today described as a "glaring omission" in the Spring Statement by George Osborne’s Northern Powerhouse Partnership organisation.

Rishi Sunak delivering his Spring Statement in Parliament.Rishi Sunak delivering his Spring Statement in Parliament.
Rishi Sunak delivering his Spring Statement in Parliament.

The NPP, which is chaired by Mr Osborne, raised concerns earlier this year that the Shared Prosperity Fund (SPF) will not adequately replace past EU funding in the North.

EU regional funding had been worth around £1.5bn a year before Brexit. The SPF is due to be worth £1.5bn by 2024/25 but will start at a lower level when it begins in April.

The Spring Statement confirmed £400m is being committed to the SPF during 2022/23, with £700m in the following year and £1.5bn in 2024/25.

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Henri Murison, director of the Northern Powerhouse Partnership, said while there was a “lot to like” in the Spring Statement such as tax cuts for businesses, it “still falls short of what is needed for Michael Gove to deliver genuine levelling up or for a green industrial revolution to achieve energy security”.

He added: “One glaring omission was the Shared Prosperity Fund, with no extra money announced to match previous EU funding as promised in the 2019 Conservative Manifesto. This is a huge concern given that the bulk of regional economic development cuts are likely to be in the North, as we previously received the most while we were in the EU.

“If this government is serious about levelling up, we need assurance that the north of England will see its funding protected, in the same way that Cornwall has by the Chancellor in previous fiscal events.”

West Yorkshire mayor Tracy Brabin said: "It’s disappointing that there has been no announcement from the Chancellor today about how much West Yorkshire will receive from the UK Shared Prosperity Fund.

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“This is the fund the government created, to replace the money the region previously received from the European Union. We understand we need to submit our investment plans for this by the summer and if we don’t hear anything soon, the government should rethink the timescales for this".

The Spring Statement did include the formal launch of the second round of bidding for the £4.8bn Levelling Up Fund, which previously allocated £1.7bn to 105 successful projects in its first round, including £187m in Yorkshire.

Ms Brabin said: "Any new money for our region is welcome. However, this falls short of the investment that West Yorkshire really needs. It’s frustrating that the government continues to insist on these ‘beauty contests’, where regions must compete against each other for short-term funding, before this money can be invested where it needs to be.

“If the government were truly committed to devolution, they would put these vital spending powers in the hands of local leaders."

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Mr Sunak’s commitment to tackling regional inequality was also questioned by Dr Arianna Giovannini, interim director of IPPR North.

She said: “This Spring Statement was the Chancellor’s opportunity to put public money where government’s mouth is. But he seriously missed the mark and failed to announce the substantial measures needed to support people on the lowest incomes, and level up the UK. This puts at risk the credibility of the Government’s flagship levelling up agenda – which barely featured in the Chancellor’s speech - with real, dramatic consequences for people’s lives.

“People in the North will now rightly begin to question whether the Government is serious about its pledge to raise prosperity and close regional divides.

“The growing chasm between rhetoric and reality is all too familiar to us. The only way to change this is for the Chancellor to return to Parliament and deliver a concrete investment plan now, alongside a set of targeted policies that improve people’s lives, to show that the levelling up agenda is not just another empty promise.”

More detail expected in coming weeks

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The Government is expected to publish a full prospectus for the Shared Prosperity Fund in the coming weeks.

In response to the Northern Powerhouse Partnership's remarks, a spokesperson for the Department of Levelling Up said: “We reject this criticism based on speculative projections of a fund whose allocations are yet to be announced.

“UK-wide funding for the UK Shared Prosperity Fund – worth over £2.6 billion - will ramp up to at least match receipts from EU structural funds, which on average reached around £1.5 billion per year.

“Alongside commitments to support regional finance funds across the UK via the British Business Bank, this exceeds the UK Government’s commitment to matching EU structural fund receipts for each nation.”

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